Kuwaiti PIC to Shut, Sell Fertilizer Business

Petrochemicals Industries Company (PIC), a unit of Kuwait Petroleum Corporation is planning to sell or shut its fertilizers business to focus on its more profitable petrochemicals division, a company executive said.

PIC is also looking at growing organically and through overseas acquisitions by spending billions of dollars, Yousef Al-Ateeqi, deputy managing director - Olefins, said in an interview. Our plan is to quit from the fertilizers business in the medium to long-term through privatization or closing down," he said on the sidelines of an industry conference organized by the World Refining Association.

"In petrochemicals, we plan to pursue growth inside and outside Kuwait by building or acquiring leading petrochemicals assets in mature markets with a proper foreign partner. PIC's fertilizers unit in Kuwait produces ammonia and urea, Ateeqi said, declining to give current production figures. PIC which recently completed its Olefins II expansion is planning a US$7 to US$8 billion Olefins III facility as part of a broader plan to create a world class Olefins complex, he said. Current capacity at Olefins I and II is about 1.65 million tons per year of ethylene and its derivatives.

"The Olefins III cracker will produce about 1.4 million tons per year of ethylene and we hope to start the project by 2015," Ateeqi said, adding it was currently at the study stage. Shareholders in the joint venture project are yet to be finalized but a foreign partner would be signed on, he said. Overseas, PIC is pushing ahead to set up the US$10 billion China Integrated Refinery-Petrochemicals Project in Zhanjiang, south China. Sinopec and Kuwait Petroleum Corporation (KPC) are equal partners in the project whose feasibility study was completed in 2008, Ateeqi said. "We are doing pre-FEED study and environment assessment of the site currently. Hopefully first contracts would be awa rded in 2010," he said.- AlWatan